Xiaomi files for largest Chinese tech IPO since 2014
03 May, 2018, 10:10 | Author: Cecelia Webb
The Chinese smartphone maker is taking advantage of changes in the former British colony that mean companies with different share classes can now list in the city. The IPO is expected to value Xiaomi's business at around $100 billion.
Xiaomi's IPO document unveiled many of its financial numbers for the first time. Lei has pledged to reclaim the top spot in China in the next 10 quarters, but it won't be easy in a declining smartphone market.
Xiaomi mentioned in the filing that from the IPO proceedings, it will invest 30% of the fund in expanding its business in worldwide markets including Russia, Europe and South East Asia.
Operating profit tripled to 12.2 billion yuan ($1.9 billion) but the company still lost almost 44 billion yuan ($6.9 billion) in 2017, mainly due to the cost of converting preferred shares held by investors.
According to a report in South China Morning Post on Thursday, the move "would catapult Xiaomi past Baidu and JD.com to become the third-biggest Chinese technology company by value, after Tencent Holdings and Alibaba Group".
Its 2017 revenue surged by 67.5% to 114.6 billion yuan ($18 billion), with overseas sales more than tripling to 32.1 billion yuan.
It's also a vital shot in the arm for a city that's been floundering in its claim to be mainland China's gateway to the financial world, ever since Alibaba chose NY over Hong Kong for its US$25 billion IPO in 2014, which still holds the record as the world's biggest stock sale.
The company is now at the fourth position in the smartphone market globally, behind Samsung, Apple and Huawei. It is also making a big push outside China's borders, with 28 percent of its sales derived from overseas markets a year ago, up from 6.1 per cent in 2015. The structure would allow the company to benefit from the "continuing vision and leadership" of the dual-class share beneficiaries, who would control the company for its "long-term prospects and strategy", it said.
The city, overtaken by Shanghai previous year for the first time in the global IPO stakes, was anxious to reclaim its crown to sustain jobs in the financial industry and maintain revenue from stock listings.
CLSA, Morgan Stanley and Goldman Sachs Group Inc are sponsoring Xiaomi's IPO.
An average iPhone was sold for $728 during the quarter, up from $655 a year ago, said CFO Luca Maestri during the investor call. He said the ASP growth was "mainly driven by iPhone X ", indicating the $1000 price point had worked in the company's favour.
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Many in the British media and online have suggested the resignation is indicative of a government on the verge of collapsing. The British government says they will be allowed to stay and has promised to set up a simple no-fuss registration process.
If you are living outside the United Kingdom , do not worry, the update should arrive to other regions in the coming weeks. As the South Korean giant is now rolling out Android Oreo 8.0 Update for the Galaxy S7 and the Galaxy S7 Edge in Europe.
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This handsome day will be made more special with the love and support of our family of fans & well-wishers. Anushka Sharma , one of India's most popular film artists, celebrated her 30th birthday on 1st May, 2018.
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